Are We Electing Friends or Foes?

Bucky Sebastian describes how the outcome of the presidential election will influence the credit union movement for years to come.


The elections are upon us. The following excerpts from the Oct 2004 "The Callahan Report" describe how the outcome of the presidential election will influence the credit union movement for years to come.

The national election looms before us. Lest anyone who is a credit union member – or manager – believe that the outcome of the election will not affect credit unions, think again. The next president is going to name all three members of the NCUA board, one of which will be the chairperson. This will set the direction of credit unions for years to come.

The NCUA board is young enough for many of us to recall each of the former chairpersons and their administrations.

Larry Connell’s background was state and federal banking agencies; he treated the NCUA like the agencies he came from. His main job was to effect the transition of the NCUA from a bureau to an independent agency overseen by presidential appointees.

Ed Callahan guided the credit union movement into deregulation, allowing it to take flight. He understood that the movement was for the members, not organizations, and that it offered the country the benefit of a cooperative alternative to the for-profit sector.

Roger Jepsen’s appointment demonstrated that politics could reach deeply into the agency. Jepsen was an Iowa senator who failed in his re-election bid but was rewarded for his party work by being given NCUA to run. Fortunately he had less of an agenda than anxiety over something going wrong on his watch. In exchange for help from the federal bureaucracy in watching out for and thwarting trouble, Jepsen let the bureaucracy have much to do with the running of the agency for his six-year administration.

Norm D’Amours was another politician rejected by the persons of his state but given the NCUA as a plum by reason of his party loyalty, and he did have an agenda. He tried to wrest the reins from the credit unions, the associations and the bureaucracy to his own personal vision of financial service providers. He wreaked havoc on the credit union system and on individual credit unions.

Yolanda Wheat’s administration was very brief. She had less of a political or ideological agenda than a personal one. She brought over the NCUA colleagues from her time at the Department of Labor, seeing the NCUA as a kind of spoils system.

Dennis Dollar understood that credit unions could thrive if they were left free to thrive. He kept his distance, and, indeed, under Dollar’s aura of laissez-faire credit unions did very well under his administration.

JoAnn Johnson seems to take the tack of “First, do no harm.” It could be worse. But not much is happening, and, as they say, “an idle mind is the devil’s workshop.” The NCUA is becoming overstaffed; persons have too little to do and so are concocting rules and regulations that could cause mischief.

This is all to say that who the chairperson is does make a difference.

Supreme Court and Congress, too
That’s not all. The next president is going to have the opportunity to shape the Supreme Court. Within the next four years there is likely to be a new chief justice named and several new justices.

Everyone should recall that the bankers worked their suit against us all the way to the Supreme Court and won; it took an act of Congress to get us back on track.

Although it seems unlikely a new suit will work its way to the highest court, the bankers have proven themselves to be eager litigators and bent on our demise. At this moment several suits are active in the states. Who is to say one won’t make it to the highest court – will we have friends there or enemies?

Then there is the Congress. Though removed from presidential appointments, the legislative branch is a powerful body, which can make or break us a financial services alternative. In the last legislative battle, bills that affected us greatly were voted out of committee by margins of single votes.

Credit unions have had very little influence over the past 30 years in choosing the NCUA chairperson. Shame on us for that, but it won't change unless we get seriously involved, and at every level. Only in this way can we exercise influence on the people who make presidential appointments.




Nov. 1, 2004


  • doesn't name names as to who appointed whom, but it looks like there is plenty of stuff on everybody's shovel.
  • Bucky S. is one of the credit union industry's most thoughtful people. Even when I don't agree with him, I am very interested in his opinion. Because of his own past involvement with NCUA, his insights should carry some weight.
  • Bucky is right on! Credit union professionals often don't recognize the importance that an NCUA Board choice can have on the movement.
  • This is an interesting summary even if General Nickerson escaped scrutiny. Bucky did a good job of supporting his thesis. But a little more risk taking in pointing out specific races would have added a little more grist for the mill. Gee, I never thought I would say Bucky was a little too nonconfrontational.
  • Great to see someone who is not afraid to really say what they think and we can understand what they said.
  • Credit unions should stick to their knitting and only focus narrowly on what is in credit unions' interests. Temptation to become political on other issues should be resisted.
  • Point well taken but it would have been nice to expand the content a little and let us have a glimpse of where Bush and Kerry stand on Credit unions. I know I can get that information from other sources, but it would have been a logical fit in the article and could have been stated without an endorsement.
  • Great points and perspective. The entire article would have made it surperb.